Foreign direct investment (FDI) is a good
source of financing sustainable development in a country.
This term is referred to the movement of capital across national
frontiers in a manner that grants the investor control over
the acquired asset.

Proposals that require an industrial license and cases
where foreign investment is more than 24% in the equity
capital of units manufacturing items reserved for the small
scale industries.

Proposals in which the foreign collaborator has a previous
venture/tie-up in India.

Proposals relating to acquisition of shares in an existing
Indian company in favor of a Foreign/Non-Resident Indian
(NRI)/Overseas
Corporate Body (OCB) investor; and

Proposals falling outside notified sectoral policy/caps
or under sectors in which FDI is not permitted and/or whenever
any investor chooses to make an application to the Foreign
Investment Promotion Board and not to avail of the automatic
route.

Foreign Investment Promotion Board (FIPB) is a competent
body to consider and recommend foreign direct investment (FDI),
which do not come under the automatic route. With the shifting
of the FIPB to the Department of Economic Affairs, Ministry
of Finance, the FIPB has been reconstituted as under:

1) Secretary, Department of Economic Affairs

Chairman

2) Secretary, Department of Industrial Policy & Promotion

Member

3) Secretary, Department of Commerce

Member

4) Secretary, (Economic Relation), Ministry of External
Affairs

Member

The Board has the authority to co-opt Secretaries to the Govt.
of India and other top officials of financial institutions,
banks and professional experts of industry and commerce, as
and when necessary.